Bank branch closures: are banking hubs the answer?
Banks have closed hundreds of branches over the past decade.
Banks have closed hundreds of branches over the past decade.
Over the past decade, 366 bank branches closed their doors. For some towns, it’s left residents without a local bank.
The industry says fewer people are going into branches and closures just reflect that reality. But it’s come under pressure to make sure customers can still access banking services when they need them. Banking hubs have been proposed as a possible solution.
The New Zealand Bankers’ Association and six banks – ANZ, ASB, BNZ, Kiwibank, TSB and Westpac – are involved in a banking hub trial in four locations: Martinborough, Ōpunakē, Stoke and Twizel.
The hubs provide an ATM, phone banking and tablets for online banking. Support staff are available to help customers use the service but they can’t provide advice on bank products, such as savings accounts and loans.
The trial started in November 2020 and will run for a year.
We headed out to the Wairarapa to visit the Martinborough banking hub. It’s located in the Waihinga Centre, which is also home to the town’s visitor information centre, Plunket, library and café.
Along with a smart ATM, there were three desks that each had a phone and an iPad for internet banking.
The visitor centre manager said about six customers come in each day to use the hub. If there’s a big event in town, numbers rise to about 30 customers.
South Wairarapa Mayor Alex Beijen said the hub hadn’t solved problems for everyone.
Branch closures have had a negative impact on the community, he said.
Closures can affect people who are less familiar with online banking and those who need extra support to use banking services. Local businesses also need branches open to make deposits or get coins for the till, Beijen said.
He points out it’s a 30-minute drive from Martinborough to Masterton, the closest town where all the big banks have branches. For a round trip, it’ll take an hour and a half, or “if you’re working, take half a day off work”.
Rural Women NZ board member Sharron Davie-Martin said she’s also aware of branch closures being an issue for her members. Some have to drive more than an hour and a half to get to their nearest branch, she said.
New Zealand Bankers’ Association chief executive Roger Beaumont said it will be assessing the effectiveness of the hubs at the end of the trial. As well as monitoring the number and type of transactions at the hubs, it will be holding community focus groups to get feedback.
“We will have a full picture of how the trial went at the end of the year when it concludes. We’ll then be able to determine its success, or otherwise, and announce next steps,” Beaumont said.
Banks involved in the trial had agreed not to close any more regional branches until the trial ended. But that commitment was suspended in January due to Covid-19 and a further 106 branches have been closed or announced pending closures. Banks have since renewed their promise to not close any more regional branches until the trial finishes.
Have you been affected by a bank branch closure? Let us know. Email nikki-lee@consumer.org.nz.
What is your advice for seniors with cash?
Over the last few years, ASB Bank has shut down our branch 3 times (each time sending us to a different one), and the last two times they did not even have the courtesy to tell us. They certainly have our email address and contact numbers so there is no excuse for this. We use online banking most of the time so we do not rely on the branch a lot but we still need to use it from time to time and an ATM is essential. The last time they even took away the ATM, so this is really inconvenient. It just shows to me that they do not value their customers, despite what they would have us believe with the advertising. Surely they could have at least left us with an ATM!
I am completely happy to do on-line banking and stopped using cheques many years ago BUT I have an elderly relative who is totally non-tech. He is lucky he lives in a big city and that his local branch is still open & staff help him set up on-line payments, while family help with the rest. BUT it is an avenue for abuse by unscrupulous "helpers". Community hubs would be a solution, but with more services i.e. surely with technology like Zoom etc. a "face to face" service could have private booths where a customer can dial into their bank and be guided by a real person to do their own entries securely? The remote "teller" would not see the secure entries, just what they would normally see if you went to a branch. Banks are a business, yes, but also a service. Secure technology should find a way?
Our local Westpac has reduced its hours so much it's next to impossible to get in to it. I would normally stop in on the way to Christchurch or on the way home, but that doesn't suit the shorter hours. The result is, Westpac is going to say people aren't using their services so it will have to close.
With the closure of face-to-face branches in many smaller towns and the cessation of cheque services, I am concerned that our elderly and vulnerable people are being left at considerable risk of scams and financial abuse.
Many of these people have little or no experience with smartphones or computers, making them an easy target for scammers.
I can also see the transition from the cheque book to online banking being too hard for many elderly, with usernames and passwords being entrusted to friends, relatives and carers so that they can help out. This leaves the elderly person wide open to financial abuse.
I have read that people that used cheques and don't use internet banking or phone banking can pay by Teller Assisted deposit at the bank.
Shirley C
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